Working in a trade can expose you to risks that many other businesses simply do not face. Whether you are working on a construction site, inside a customer’s home, outdoors or at different locations throughout the week, accidents, injuries and unexpected damage can happen.
For self-employed tradespeople and small trade businesses, the financial consequences can be significant. Damage to a customer’s property, an injury to a member of the public, stolen equipment or an accident that leaves you unable to work could potentially cost thousands of pounds.
That is where tradesman insurance can help.
A suitable tradesman insurance policy can combine several different types of business insurance into one package, helping to protect you, your employees, your customers and the work you undertake.
Who Needs Tradesman Insurance?
Tradesman insurance is designed for people working in skilled manual and technical occupations.
Depending on the insurer and the type of work being undertaken, cover may be suitable for trades including:
- Builders
- Electricians
- Plumbers
- Joiners and Carpenters
- Painters and Decorators
- Plasterers
- Roofers
- Landscapers
- Bricklayers
- Tilers
- Heating Engineers
- Property Maintenance Contractors
- Groundworkers
- Other Skilled Trades and Contractors
You may be self-employed, operate as a sole trader, run a limited company or employ a small team.
The type and level of insurance you need will depend on factors such as the work you carry out, where you work, whether you employ anybody, the value of your tools and equipment and the size of the contracts you undertake.
If you operate from dedicated commercial premises, you may also need additional business insurance to protect the building, contents, stock and other business assets.
What Does Tradesman Insurance Cover?
There is no single tradesman insurance policy that is right for every business.
A plumber working inside residential properties will face different risks to a roofer working at height or a contractor working on major commercial developments.
This is why tradesman insurance is normally built around the needs of the individual business.
Depending on the policy, cover may be available for work involving:
- Domestic Customers
- Commercial Customers
- On-site Work
- Contract Work
- Public Sector Contracts
- Quoting and Consultancy
- Work Away From Your Usual Location
- Certain Types of Overseas Work
The exact activities covered will depend on your insurer and policy wording, so it is important to accurately describe all the work your business undertakes.
What Can Be Included in a Tradesman Insurance Policy?
A tradesman insurance policy can combine several different types of cover.
Rather than purchasing completely separate policies, your insurance adviser can help you build protection around the risks associated with your particular trade.
Common types of cover include the following.
Public Liability Insurance
Public liability insurance is one of the most important forms of protection for many tradespeople.
It can provide cover if a member of the public suffers an injury or their property is damaged as a result of your business activities and you are found legally liable.
For example, imagine that you accidentally damage expensive flooring while carrying out work in a customer’s home. Alternatively, a member of the public could trip over equipment you have left in an unsafe position.
A public liability claim could involve compensation payments as well as legal expenses.
Although public liability insurance is not generally a legal requirement in the UK, many customers, contractors, local authorities and commercial organisations may require evidence of suitable cover before allowing you to start work.
Employers’ Liability Insurance
If your business employs people, you may need employers’ liability insurance.
Employers’ liability insurance provides protection if an employee becomes ill or is injured because of the work they undertake for your business and subsequently makes a claim against you.
For many UK businesses with employees, employers’ liability insurance is a legal requirement, although some exemptions apply depending on the structure of the business and your relationship with the people working for you.
Tradespeople should therefore check their individual obligations rather than assuming that their business is exempt.
Personal Accident Insurance
If you are self-employed, your ability to work is one of your most valuable business assets.
An injury could prevent you from carrying out physical work for weeks or even months. Without an employer providing sick pay, this can quickly create financial difficulties.
Personal accident insurance can provide financial support following certain accidental injuries covered by the policy.
Depending on the cover selected, benefits may be available for temporary disablement, permanent disablement or accidental death.
The appropriate level of cover will depend on your occupation, earnings and individual circumstances.
Contract Works Insurance
Contract works insurance can help protect building work that is currently in progress.
For example, imagine you are several weeks into a renovation project when part of the work is damaged by fire, flooding, theft, vandalism or another insured event.
Without appropriate cover, you could potentially face the cost of replacing materials and completing the work again.
Contract works insurance is generally designed to protect the work being undertaken, together with certain materials associated with the project.
It does not automatically insure the customer’s entire existing building, so understanding the scope and limits of the policy is important.
Tools and Equipment Cover
Your tools are essential to your ability to earn a living.
Replacing stolen or damaged equipment can be expensive, particularly for tradespeople who carry specialist power tools, testing equipment or machinery.
Tools insurance can provide protection against certain types of theft, loss or damage, depending on the policy.
If tools are routinely stored in a van overnight, check the policy carefully. Insurers may impose conditions concerning vehicle security, where the vehicle is parked and how equipment is stored.
Plant and Machinery Cover
Some trades require machinery or larger pieces of equipment in addition to everyday hand and power tools.
Insurance may be available for your own plant and machinery as well as equipment you hire.
This can be particularly important for businesses working in construction, groundwork, landscaping and other sectors where expensive equipment is regularly used on site.
Do Subcontractors Need to Be Covered?
If you use subcontractors, it is important to explain the arrangement to your insurance provider.
Insurers may distinguish between labour-only subcontractors and bona fide subcontractors, and the way they are treated under your insurance can differ considerably.
Do not assume that somebody is automatically covered simply because they describe themselves as self-employed.
Your insurer or adviser can help establish whether subcontractors need to be included within your employers’ liability or other sections of your policy.
Can Tradesman Insurance Cover Work Abroad?
Some tradesman insurance policies can be extended to cover certain work outside the UK.
However, overseas work should never be assumed to be automatically included.
The insurer may need to know:
- Which Countries You Will Work In
- How Long You Will Be Abroad
- What Work You Will Undertake
- The Value of the Contract
- Whether Employees Will Travel With You
- Whether Specialist Equipment Will Be Taken Overseas
Tell your insurance provider before accepting overseas contracts so that appropriate cover can be arranged.
What Other Optional Cover Is Available?
Depending on your occupation and the work you undertake, additional insurance may be available.
This could include cover relating to:
- Tools and Equipment
- Owned or Hired Plant
- Contract Works
- Personal Accident
- Work Abroad
- Specialist Locations
- Asbestos-related Work
- Legal Expenses
- Professional or Design-related Risks
- Business Equipment
Not every insurer will cover every activity, particularly higher-risk trades or specialist work.
Providing accurate information about your business is therefore essential.
How Much Tradesman Insurance Do I Need?
The right level of insurance depends on the potential financial risk your business faces.
A small sole trader carrying out domestic repairs may require very different limits from a contractor working on commercial developments worth hundreds of thousands of pounds.
When considering your cover, think about:
- The Maximum Value of Contracts You Undertake
- The Types of Properties You Work In
- Whether You Employ Staff
- Whether You Use Subcontractors
- The Value of Your Tools and Equipment
- Whether You Hire Plant or Machinery
- The Potential Cost of Property Damage
- Requirements Imposed by Customers or Main Contractors
Choosing insurance purely on price can leave significant gaps in your protection.
It is usually better to consider what could realistically go wrong and the potential financial consequences for your business.
Why Is Tradesman Insurance Important?
Even experienced tradespeople make mistakes, and some incidents are entirely outside your control.
One serious claim could have a considerable impact on a small business.
Tradesman insurance can provide valuable financial protection against insured risks while allowing you to concentrate on running your business and completing work for your customers.
Having appropriate insurance may also make it easier to secure certain contracts, as larger organisations and commercial customers frequently ask contractors to provide evidence of insurance before allowing work to begin.
Looking for Tradesman Insurance?
No two tradespeople face exactly the same risks.
At West Craven Insurance, we can help you consider the different types of cover available and arrange a tradesman insurance policy suited to the way your business operates.
Whether you are a sole trader, subcontractor or run a growing trade business with employees, we can help you assess the risks you face and identify appropriate insurance protection.
Speak to West Craven Insurance today to discuss your requirements and obtain a quote for tradesman insurance.
